Learn about the marketing funnel and how to use it
It’s easy to feel overwhelmed when trying to understand marketing funnels. Descriptions are heavy on jargon and light on practical advice. Adding to the complexity is the fact that there’s no single model all experts can agree on.
But avoiding the topic altogether isn’t an option. Regardless of your industry, the concept is critical in organizing your efforts for identifying and nurturing potential customers. That’s why we’ve compiled a list of the best practices and benefits to help you think through your own process.
In this article about the marketing funnel, we’ll cover:
What is a marketing funnel?
A marketing funnel is a method for converting leads into customers by first targeting a wide number of consumers (how wide will depend on your budget and the size of your potential audience). In a perfect world, each person you target would stick around for the entire customer journey, which would end with their handing over their hard-earned cash. In today’s competitive world, however, the number of audience members inevitably narrows.
The reasons vary. Maybe they weren’t that interested in your product in the first place. Maybe your price is out of their budget. And the list goes on. Whatever the cause, there will be those who lose interest, leaving you with fewer and fewer leads to nurture — hence the funnel metaphor.
That funnel includes four stages:
We’ll go into more detail on those further down. But first, a quick disclaimer — as mentioned before, not all experts break down the marketing funnel the same way. The good news is that those variations are relatively minor. All of them tell the same story, which is that as the marketing funnel narrows, potential leads will drop out of it until the point of sale. All of them also share the same goal of capturing conversions — or, in other words, minimizing the number of leads that drop out.
Finally, all agree that one of the central uses of a marketing funnel is the ability to identify where those holes in the funnel are located. Once you know that, patching them becomes a lot easier.
Stages of the marketing funnel
As you read through the following stages of the marketing funnel, keep in mind that they apply to more than a single promotion or product (unless, of course, you have just one product). Rather, these steps are meant to refer to the entire journey your typical customer goes through — from first learning about your brand to making a purchase.
Attention. This is the stage in the funnel when a potential customer becomes aware of your brand, be it through an ad, recommendation, or an online search.
Interest. If a consumer becomes aware but nothing more, they’re out of the funnel. But if their interest is piqued, you’ve generated a lead. At this point, they begin learning more about your business and your offerings. This, in turn, opens the door for you to deliver tailored touches that speak directly to how your product or service can benefit them. Succeed, and you’ll have the beginnings of a business-consumer relationship.
Desire. Once this happens, you have a “qualified lead,” someone who has expressed interest but has yet to open up their wallet. If you have a marketing team, it’s their job to identify these potential customers and actively nurture those leads by providing them with more personalized content and interactions — from emails to phone calls, depending on the industry.
Action. The customer makes a purchase and completes their journey through the funnel.
With those stages fresh in your mind, it’s time to drill down into the benefits of the funnel as a unified whole.
Benefits of marketing funnels
The marketing funnel is more than a fancy concept a wild-haired professor came up with in a business school. It describes a real-life process with measurable benefits to your business. Here are a few of those benefits.
- Maintaining a marketing strategy. Once you know where your customers are falling off in the marketing funnel, you’re positioned to implement strategies that directly address shortcomings in your marketing strategy.
- Consistent promotion. The more familiar you are with the stages of the marketing funnel, the better you’re able to ensure tactics for each one.
- Increase sales. With those tactics in place, you are prepared to expertly guide each potential customer through to the point of sale.
- Save time and effort. Knowing your customers’ marketing journey and predetermining marketing strategies for each stage of the funnel means you will already have a plan set for when customers drop off.
- Predictive sales. Once you have a sense of how big your audience is at every stage of your funnel, the better you can forecast future sales.
- Customer retention. Research indicates the costs associated with converting a new customer are more than five times that of retaining an existing one. Having a plan for each stage of the funnel should include being prepared to reengage them the moment they reach the bottom.
Of course, it’s easy to theorize about a successful marketing funnel, but it’s harder to implement one that actually delivers on each of these benefits. For that, let’s use an example.
Marketing funnel example
The exact tactics that you assign for each stage of your funnel will depend somewhat on your audience, your product or service, and your marketing budget. That said, we can learn a lot from the way Mailchimp, one of the world’s most successful email marketing companies, uses a marketing funnel.
Started in 2001 as a side project, Mailchimp was one of the first to invest heavily in podcast advertising, including sponsoring the launch of the blockbuster show Serial. The decision apparently worked wonders for Mailchimp, whose ads were ubiquitous in many of the top podcasts for years afterward.
Just as important — if not more — to increasing its brand awareness was the company’s decision in 2009 to create a freemium model. In this version, users could send emails at no cost but were unable to remove Mailchimp branding from the bottom of their messages. A year later, the user base had grown from 85,000 to 450,000, according to its own blog, and the Mailchimp logo was everywhere.
These ads and others continue to send interested audience members to the Mailchimp home page, where prospective customers are greeted by friendly imagery, large fonts, and aspirational calls to action like “Sell more” and “Win repeat business.” These elements, plus image-heavy descriptions of what Mailchimp does, direct all traffic to the same place — the sign-up page.
However, Mailchimp recognizes that not everyone is ready to pounce the first time they arrive at its website. Some viewers may spend weeks or longer in the interested camp before moving into the “Desire” stage. For these individuals, the website offers a treasure trove of informational and inspirational content designed to keep them coming back and interacting with the Mailchimp brand. At the same time, these videos, podcasts, and blogs serve to establish Mailchimp as a thought leader and ensure its existing customers remain engaged.
This emphasis on thought leadership is especially important for brands with a business-to-business (B2B) audience, which increasingly look to the brands they partner with as just that — partners. Business-to-consumer (B2C) marketing funnels, in contrast, tend to emphasize different tactics.
The difference between B2B and B2C marketing funnels
Because B2B marketing targets businesses and B2C marketing targets individual consumers, there are nuances in how the marketing funnel operates. This is true even as the steps within the marketing funnel — attention, interest, desire, and action — remain largely the same.
The biggest difference has to do with the speed at which potential customers move through these stages. If you’re selling to an organization, odds are there are multiple parties that must greenlight the purchase of your product or service. There are quarterly budgets to consider, approvals and review processes to align with, and department heads to consult. All of this takes time and is the reason many B2B marketing strategies feature detailed buying personas representing each stakeholder involved.
In B2C marketing, by contrast, you’re typically only relying on one person to make a decision.
Get started with marketing funnels today
Successful marketing funnels aren’t just for Fortune 500 companies. Regardless of your organization’s size or industry, you have the tools to map a customer journey that generates and nurtures leads effectively toward a point of sale.
This means having a plan in place to spread awareness of your brand and instill interest in it before crystallizing that interest into desire and finally action. Do this, and you won’t only increase your number of first-time buyers. You’ll also increase the number of repeat customers who feel a sense of loyalty based on their positive interactions with your business.
Ensure your ability to tailor the most successful marketing funnel possible using data-powered tools. Adobe Customer Journey Analytics, a service built on Adobe Experience Platform, can help you understand your own audience’s behavior through customer analyses on the individual level. Use it to connect all your customer data together and discover hidden opportunities to jump-start your ROI.
Customer Journey Analytics can break down, filter, and query years worth of data and combine it from every channel into a single interface. Real-time analysis and visualization allow companies to make better decisions with a holistic view of their business and the context behind every customer action.
View every action in the customer journey, regardless of changing market forces, and create experiences that adapt to customers in real time.
Check out the Adobe Customer Journey Analytics overview videoto learn more.